Bernie Sanders Attacks Hillary Clinton Over Regulating Wall Street

Senator Bernie Sanders of Vermont in a fiery speech on Tuesday laid out his plan to break up “too big to fail” commercial banks and pointedly attacked Hillary Clinton for taking speaking fees from the financial industry and, in his view, not going far enough in her plan to regulate Wall Street.

The criticism of Mrs. Clinton was some of Mr. Sanders’s strongest to date, and came after he had frequently refrained from such direct attacks.

“My opponent says that as a senator, she told bankers to ‘cut it out’ and end their destructive behavior,” Mr. Sanders said of Mrs. Clinton. “But, in my view, establishment politicians are the ones who need to cut it out. The reality is that Congress doesn’t regulate Wall Street. Wall Street and their lobbyists regulate Congress. We must change that reality, and as president, I will.”

Mr. Sanders said that Mrs. Clinton was “wrong” to oppose his plan to reinstitute the Glass-Steagall Act, which would legally separate commercial banking, investment banking and insurances services. And the senator implicitly criticized Mrs. Clinton for being a patron of bankers when he pointed to their huge campaign donations and noted that they “provide very generous speaking fees to those who go before them.”

Mrs. Clinton has made hundreds of thousands of dollars speaking to banks and large corporations over the years.

Speaking at Town Hall in Midtown Manhattan, Mr. Sanders said that if elected president, he would enact much bigger and bolder plans than Mrs. Clinton and transform the country’s financial system by enforcing stricter regulations on banks. He also offered some new consumer-friendly proposals such as capping automated teller machine fees at $2 a transaction and limiting credit card interest rates, which he called “usurious.”

“Greed is not good,” Mr. Sanders said, in a rebuttal to the famed character from the movie “Wall Street,” Gordon Gekko. “In fact, the greed of Wall Street and corporate America is destroying the very fabric of our nation.”

Mr. Sanders, an independent and self-described democratic socialist, often focuses on the financial industry and income inequality in his stump speeches and has released a long list of progressive plans, including expanding Social Security and making public universities tuition-free, as part of his campaign platform. He frequently laments the influence of “millionaires and billionaires” in America and regularly argues that too much of the country’s wealth is controlled by an elite handful of individuals.

Mr. Sanders reiterated his focus on the working class Tuesday, saying that poorer Americans needed more affordable banking options and that banks must stop taking advantage of vulnerable people. To make such changes, he said, he would fight to allow post offices to “engage in basic banking services.”

“The reality is fraud is the business model of Wall Street,” he said. “It is not the exception to the rule. It is the rule.”

The Clinton campaign pushed back against the notion that Mrs. Clinton was too soft on bankers, arguing that she would be tougher on the “shadow banking” sector and claiming that it was Mr. Sanders whose proposals did not go far enough.

Mrs. Clinton addressed the issue of banking reform in Iowa on Tuesday afternoon when a voter asked her to describe the key difference between her and Mr. Sanders.

“I have a broader, more comprehensive set of policies about everything, including taking on Wall Street,” Mrs. Clinton said. “Everybody who has looked at my proposals say they are tougher and more comprehensive.”

Mr. Sanders also vowed on Tuesday that as president, he would order the Treasury Department to create a list of financial institutions that are dangerously large and break them up within his first year in office. He would overhaul the Federal Reserve by eliminating the central bank’s “internal conflicts of interest” and providing stricter oversight. He also called for changing the relationship between banks and credit rating agencies by preventing banks from choosing who rates them and by requiring the agencies to become nonprofit institutions.

Wall Street, Mr. Sanders said, would be held accountable under his administration. “Not only will big banks not be too big to fail, but big-time bankers will not be too big to jail.”

Supporters of Mr. Sanders praised his decision to take on Mrs. Clinton.

“He needs to be more aggressive in differentiating himself from Hillary,” said Victor Fuentes, 47, of Lynbrook, N.Y., who works at Verizon. “I applaud him for wanting to run a campaign that is not driven by smut or driven by dirt. But, I feel that his standings in the polls are hurt because he has run his campaign a little bit too kind towards her.”

Democracy for America, the progressive political action committee that has endorsed Mr. Sanders, said that the senator’s plan to dismantle the banks made him stronger than Mrs. Clinton on financial change.

A spokesman for the group, Neil Sroka, said Mr. Sanders’s Wall Street plan was “squarely in line with the big, bold populist progressive reforms that our country needs to thrive and the Democratic base has been calling for since the 2008 crash.”

As Mr. Sanders suggested, Wall Street was paying attention, too. With Mrs. Clinton holding a commanding lead in most polls, however, her proposals appear to carry more weight.

Les Funtleyder, a portfolio manager at E Squared Asset Management, said that Mrs. Clinton’s remarks about regulating companies tended to move the market more than those of Mr. Sanders. “This suggests to me The Street is more interested in what Hillary says at this point,” he said.